Airbnb - business process reengineering PDF

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Summary

business process reengineering...

Description

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TITLES

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INTRODUCTION

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GLOBAL SCENARIO

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INDIAN SCENARIO

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PROJECT BRIEF

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LITERATURE REVIEW

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AIR BNB

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OBJECTIVE

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RESEARCH MTHODOLOGY

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EXPACTED FINDING

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REFERENCES

INTRODUCTION

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Airbnb, the world leader in accommodations of the “sharing economy”, allows you to find places to stay directly from individuals in thousands of cities around the world. It allows you to rent apartments (or even entire houses) from people all over the world, almost everywhere in fact. The platform really revolutionized the world of accommodations. To give you an order of magnitude, the company is already worth more than 30 billion. The Hilton hotel company, which has been around for almost 100 years? 20 billion. And Airbnb doesn’t even own any real estate. The important thing to know is that it’s big, and you can trust them. A fun fact for those of you curious about the name origin, it comes from the abbreviation for Bed and Breakfast, or B&B. The founder wanted to replicate that with an inflatable mattress (Air) in his apartment in San Francisco (a city where housing and accommodations are very expensive). There are two main options on Airbnb, either to have an entire apartment or house all to yourself (more expensive of course). But the most common is to only rent a room in a house and share the place with its owners, or even other travelers. Why Use Airbnb First, Airbnb isn’t necessarily for everyone or at least it’s not the best solution for all types of travel. It really depends on your preferences, and what kind of experience you want. We will try to give you some details so that you can make an informed decision, and further on we’ll also explain how to use it step by step. Live As a Local Many people like Airbnb because it allows you to live a bit more as a local than a tourist. It gives the impression of being a resident of the place, rather than just a visitor. And it’s true that it’s a different experience and that it can be very pleasant if the place is located in a lively and dynamic part of town. It’s more authentic and usually does a better job of immersing you in the local culture than getting a hotel room. You can also usually use the kitchen instead of eating out at the restaurant (that can help reduce trip costs). Meet People Those who want to meet locals are also usually very happy with Airbnb, because if you choose a room in someone’s home, it’s usually easy to make a new friend. The host will often be happy to welcome you, to tell you about the best things to do in his city, etc. It allows you to get to know the place you visit even more authentically and to meet someone who really lives there.

Save Money (sometimes) Many people also use it to save money. Except that, as most things in the world of travel: it’s not true that it’s always cheaper. It’s like plane tickets and rental cars (and actually everything about travel), the price will vary depending on your dates and especially where you go. As a general rule, Europe is usually where the savings are really noticeable compared to hotels. Hotels are extremely expensive in Western Europe, so Airbnb really becomes an interesting option. I’ve been able to enjoy them on my last trip to Barcelona and we also did in the Canary Islands last December. On the other hand, in North America, it really depends. On a trip last summer, Andrew compared Airbnb and hotels and, in New Orleans the hotels were very beautiful, very well located, and cheaper … a few days later, when he rented a car to go only two hours away on a roadtrip on the Gulf Coast, there it was really cheaper to go with Airbnb than with hotels. So, it’s up to you to compare, as always, taking the time to do some research could save you a lot. In Asia, it’s also very cheap … but hotels too, so again, every situation is different. Always compare. Also, if you are in a group, renting an apartment or a complete house on Airbnb is often cheaper (and very enjoyable as an experience). Finally, the longer you stay, the more Airbnb is usually worth it, as they always charge an additional fixed fee for cleaning (which is clearly stated) to the final price, which is the same regardless of the number of nights. So, the more nights you book to spread out this fee, the greater the savings compared to hotels. In addition, some hosts choose to give discounts for weekly or even monthly rentals (also clearly stated). How It Works It’s basically very similar to any hotel search tool. You put in your destination, your criteria, and that’s it! The website (or application) will show you all the available options. You have the option to use the list on the left and also a map, which is convenient to ensure you find yourself in an interesting area. Be careful, because unlike hotels (which are, the vast majority of the time, located in neighborhoods with at least a minimum of attractions and services), when you rent an apartment, it can literally be in the middle of a residential area with absolutely nothing around. Other things that you need to know: make sure to select “entire home” in the filter if you want a place to yourself, because the majority are “private rooms” in a shared house, as mentioned

above. There are plenty of filters available on the search tool to get what you are looking for and not be disappointed. Also, unlike hotels where you can search for one person even if there are two of you and it doesn’t really matter, on Airbnb there are often restrictions or even sometimes charges for an additional guest, so clearly indicate the right number from the start. There is also an “Instant Book” filter that I recommend you remove, unless you’re looking for last-minute options. This option limits what you see to those that are instantly bookable. Remove it and you will see more options, but it might be longer before you have a confirmation because the host will have to approve manually (which is not the case with the places in “Instant Book”, for those it’s instantaneous like a hotel). Once you get to the page of your selected accommodation, you will have all the detailed information about it: what is included, what is allowed, arrival and departure time, etc. Read it because it obviously varies enormously from one place to another, by the very nature of this platform. Also, each home has been reviewed by real users, which helps you know what to expect. Look at the rating given to specific room/home and the host’s rating and read the reviews to finalize your choice. Moreover, at the end of your stay, you will be invited to make comments too (do it!) and the host will also evaluate you as a guest so that the next hosts know you a bit more. Finally, just like hotels, booking at the last minute can be risky because prices can increase significantly if there is a major event or higher demand that reduces the supply of rooms available. Timeline of Airbnb 2007 – October: idea creation 2008 – August: launchedAirbedandBreakfast.com 2008 – Aug to Nov: Sold cereal boxer & earned $30,000 2009 – January: Accepted into Y combination. Received $20,000 funding. 2009 – March: Website name becomes Airbnb.com 2010 – November: Received funding of $7.2 Million 2011 – February: Reach 1 Millionth booking mark. 2011 – July: Received funding of $112 Million. 2012 – January: Reaches 5 millionth booking mark.

2012 – June: Reaches 10 Millionth booking mark. 2014 – August: Received funding of $475 Million. 2014 – October: A law named Airbnb is made in San Francisco. 2015 – June: Received funding of $1.5 Billion. 2016 – June: Legal Airbnb sues the city of San Francisco over a new law that would require Airbnb to verify that their hosts are registered with the city. 2017 – June: Humanitarian and Airbnb launches its Open Homes Platform, an initiative aimed at providing short –term housing over the next five Years for 1,00,000 people in need. 2018 – February: Partnership Airbnb announces partnership with SiteMinder, a leading cloud platform for hotels, to allow boutique hotels and bed and breakfasts to list on Airbnb site through a third – party distribution service. 2019 – September: Financial Airbnb announces going public in 2020.

Global Scenario Airbnb may be the most global among Silicon Valley's mega-unicorns. With homes and bedrooms available in 34,000 cities and 190 countries, Airbnb operates in more than double the number of territories as does ride-share giant Uber. And unlike Snapchat or Pinterest, which have grown mostly within the United States, the $25 billion home-sharing service now sees two-thirds of its trips booked across country borders. Europe is actually Airbnb's largest market. But a truly international startup presents it's own problems. Airbnb's VP of Product, Joe Zadeh, describes it with a questionable portmanteau: the "glocal" challenge. "We have to simultaneously build global and local, because for Airbnb to work we have to be everywhere," he tells FORBES. The fundamental tension that Airbnb has to solve is bridging this global-local gap. On one hand, there are certain parts of the travel experience that must be applied in all places, like cleanliness standards. Everybody wants freshly laundered sheets. On the other hand, so much of what makes Airbnb stand out from the millions of cookie-cutter hotel rooms you can stay in is the uniqueness of the local experience. For example, translation becomes a delicate balance. If you're traveling to Japan from the U.S., you probably want to read home listings in English. But if Airbnb automatically translated

Japanese profiles, visitors might expect that their host speaks English as well. The current solution: displaying profiles in the local language, and adding an optional translate button. Airbnb also has to customize its offerings based on the local payment options. With the Olympics coming to Rio this summer, Brazil is a key growth market for Airbnb. But last year the platform only supported U.S. dollars as a payment method in the country, which covered just 22% of Brazilian payment volume. Since then, the company has added much more: national credit cards that can charge in Brazilian currency Real, as well as Boletos, a cash payment system run by local banks, and installment plans. "Our top lesson was that data is very good but you have to go deeper to understand," Zadeh says. "You might look at conversion rates in Brazil and they look fine, but the reality is there are so many people who are not using your service because they don’t even get that far. They get to your homepage and see that you won’t accept payments in their currency." The 30 million guests who booked accommodations through Airbnb in 2015 paid the company in 32 different currencies and then Airbnb paid out to hosts in a total of 65 currencies. Another focus for Airbnb: localized sign-up methods. In the United States, Airbnb lets you sign up with an email address or a Facebook or Google account. But those aren't the best methods everywhere around the world. In China, for example, Airbnb now accepts log-in credentials from users with Weibo or WeChat accounts. That change helped grow the company's customer base of Chinese travelers by 700% in 2015. (It's still impossible for hosts to rent out rooms in China). "If you get the right sign-up methods, the sign-up conversions can skyrocket overnight," Zadeh says. "So we're not going to add every single sign-up method, but when a place is an important destination for us or for people traveling from there, we will invest in trying to understand what's going on in that place." Airbnb is going to get a lot more local in the coming years. Last month, cofounder and CEO Brian Chesky announced an app redesign that added new elements like neighborhood reviews and recommendations for Airbnb users. It's all part of owning the entire travel experience, rather than just helping tourists rent a room. "It's really good to understand what’s global and what’s not," Zadeh says. "What of your product needs to change to work and what doesn’t? Sometimes people even go too far to be local. You have to keep the global essentials pristine too." Indian Scenario

Airbnb has seen massive growth in India since its launch. Over one million Indians have travelled on Airbnb globally. Airbnb listings in India have grown by 115 per cent in the past year, with over 30,000 listings all across India. This has been made possible by Airbnb’s initiatives to build a community in the local market and partnerships with State-run tourism agencies. BusinessLine met Chris Lehane, Head of Public Policy & Communications, Airbnb, during his visit to Mumbai to announce a partnership with the Maharashtra government recently. With the rise of a digital economy, digital travel sales in India are set to touch the $22.52bn mark in 2017, according to eMarketer. According to Indian Ministry of Tourism, India registered an 11% year-on-year increase in foreign tourist arrivals (FTAs) during 2016, with as many as 9 million tourists visiting the country, excluding visits by non-resident Indians. This has facilitated growth of online marketplace and hospitality service like Airbnb in the Indian market. Airbnb's CEO Brian Chesky believes that India will be one of the biggest world market in 10 years for Airbnb, as the company saw 185% increase in travellers from India and a 184% increase in bookings in India (in-bound). Airbnb is democratizing tourism by bringing its economic benefits to communities that typically haven’t shared in these benefits in the past. With a model where hosts retain 97% of the listing price, and a global average of 42% of guest spending occurring within the neighborhoods where they stay, the economic impact of home sharing can be significant for off beat, or less frequented travel destinations. Indian government is favouring the growth of home sharing and Airbnb has taken advantage of this. Airbnb aims to dominate the Indian market by tying up with Maharashtra government, Government of Gujarat and Government of Andhra Pradesh, to help boost local tourism. Airnb also announced first airline partnership in India with Jet Airways to add momentum to their Indian growth. To know more about it, The Drum spoke with Amanpreet Bajaj, India country manager for Airbnb. He said: “In India, we have forged partnerships with business and community stakeholders as well as decision makers to empower the home sharing sector. Through our partnership with Government of Gujarat we drive awareness about the platform, we organized sessions and workshops for the local community to sensitize them on our global hosting standards for potential hosts." "With the Department of Tourism, Government of Andhra Pradesh we help promote the state’s rich art, cultural and craft heritage to a global audience. Through this partnership, Airbnb is helping rural artisans engage in creating the flagship craft works of Andhra Pradesh, to list their

accommodations and experiences on the Airbnb platform for domestic and international travelers visiting Andhra Pradesh.” Airbnb also signed a memorandum of understanding with the Self Employed Women’s Association (SEWA) of India in a bid to promote tourism to quaint, rural locations in the country, and with Thomas Cook as well. Airbnb is also working with the World Bank Group, on initiatives including a study on the development impacts of home sharing, and pilot projects in areas jointly identified as emerging tourist destinations. Airbnb also ventured into entertainment by launching the ‘Ae Dil Lets Airbnb’ campaigning partnership with Bollywood film Ae Dil Hai Mushkil late in 2016. As to how Airbnb plans to maintain its steady growth, Bajaj said: “Our marketing strategy in India is driven by understanding the spirit of the locals, who have gone on to become a part of their global community of travelers and hosts." "India is characterized by its cultural multiplicity and the spirit of hospitality found in the concept of ‘Atithi Devo Bhava’ or ‘The Guest is next to God Himself.’ This spirit is inherent in homes across regions in the country, with hosts exhibiting an inclination to best serve their guests, and to introduce them to the nuances of local life. This is in line with the value that Airbnb espouses to enable people to feel like they can belong anywhere in the world, even if just for a night. This is what distinguishes India’s hosting culture, as we continue to form a strong community of hosts who are opening their hearts and homes to the world." “Over time, we have continued to engage with the market in order to deepen our understanding of the cultural nuances and local dynamics. We have also encouraged the host community to come together and share best practices and hosting experiences with one another. Hosts form the core of our community, and we engage with them consistently for them to better understand hosting standards, and to share experiences with one another in order to better host their guests.” He further emphasized about the ‘Live There’ campaign, which was born from a basic insight about what travelers seek when they embark upon their journeys. It was launched in India in June 2016 to offer Airbnb’s experiences to the evolving Indian traveler. About further expansion plans, Bajaj said: “In March, 2017, we announced the launch of Trips in New Delhi, India, adding 15 bookable local experiences, in addition to the thousands of homes available to stay in. We believe there is a new economy that can be driven based on people’s inclination to have new experiences. The biggest asset in the world is not the things people own, it is their time and how they utilize it, especially when they travel, is of utmost importance. There is great potential when it comes to entertainment and experiences – It gives people the opportunity to be entrepreneurs and to contribute to the community.”

Whether Airbnb considers homegrown Oyo rooms as its direct competitor in the Indian market, Bajaj said: “We do not usually comment on competition but we believe that Airbnb is the only place where travelers and hosts can have a unique and dynamic experience across over 191 countries in a secure and comprehensive manner." "We also feel that as travel habits and consumer demands evolve, businesses are constantly innovating to deliver to these demands. The travel space has immense potential for diversity and it is encouraging to see a shift in the domain, as people increasingly know what they want from their travel experiences." The 'secure manner' is an important part of Airbnb's sell in countries like India. It also bought a background-check startup, Trooly, to better facilitate trust between strangers on, off and across the platform, supporting Airbnb’s overall strategy. Bajaj's comments tie closely to the wider strategy for Airbnb, which included a recent review of its agency partnerships. The company decided to refresh its partnerships as it looks to bring content and product closer to each other via creativity.

Project Brief Identifying the innovative ideas for marketing and brand promotion of Air BNB, how AIR BNB used BPR (business process re-engineering) to generate dramatic improvements in critical performance measures such as cost, quality, service and speed. In order to make “mobile the best way to book Airbnb,” the team needed to not only redesign the app in a traditional sense — colors, UX, buttons — but also in a process sense. Previously, the product development team and the design team worked in silos. They had an elaborate back and forth process filled with “quasi-prototypes” and “layers of abstraction,” says design head Alex Schleifer. Schleifer, together with 300 people on Airbnb’s product team spent nine months trying to reengineer how the product development process works. The new app is the first major outcome of this new system. A process that used to take days of revision is now done in 45 minutes thanks to successful Business Process Reengineering. Research Methodology Descriptive research will be used for this study as it ...